Buying your first property in Hong Kong
Savvy investors, first-time buyers, and purchasers looking to move up the property ladder, all have a finger on the pulse of Hong Kong’s property market. In fact, the appeal of Hong Kong’s property market is world-renowned, and the changing trends in its prices constantly make the headlines. Hong Kong is a vibrant, global financial hub that is home to one of the world’s freest economies and offers a relatively safe and stable living environment. So it’s hardly surprising that it’s real estate is so coveted. However, if you are looking to buy your first Hong Kong property, there are a few important specifics you need to keep in mind. Hong Kong’s real estate is amongst the priciest in the world. If you have decided you want to have a home in Hong Kong, or you want to participate in its dynamic economy by way of a real estate purchase, you need to know how much it costs to buy a home in Hong Kong. Like elsewhere in the world, the price of a home in Hong Kong is governed by various factors. Size, location, the age of the property, if it is a new build or a new old build, its proximity to public transport and conveniences are some of the common factors that determine the prices of properties in Hong Kong.
Pricing
Now that you know what homes cost in Hong Kong, do you think you can afford to buy one? Do you have enough for an all cash purchase? Do you need to take a mortgage? While buyers including those who were not permanent residents in Hong Kong could previously borrow with abandon, in recent times the Hong Kong government has introduced various limits on the maximum loan to value ratios for property mortgage loans in 2013 and then again in 2015. Details of these measures governing bank mortgages for residential and commercial properties are available on the Hong Kong Monetary Authority’s website.
Affordability
Changes to the Mortgage Insurance Program
Costs In addition to the above costs, there are various duties a buyer of property needs to be aware of when contemplating buying property for the first time in Hong Kong. These costs become especially relevant if the buyer is not a permanent resident of Hong Kong. The Hong Kong Government since 2009 has introduced a slew of property cooling measures in the form of various duties. These duties are applicable retrospectively on property purchases from 27th October 2012. Buyers who are not permanent residents of Hong Kong need to pay a Buyer’s Stamp Duty and a Special Stamp Duty apart from the Ad valorem stamp duty (AVD). The AVD was subsequently modified aswell. From February 23, 2013, the AVD rate for property transactions valued HK$2 million and more was raised from HK $100 to 1.5% of the value of the transaction. The highest AVD was doubled from 4.25% to 8.5%, and it came to be known as Double Stamp Duty (DSD). The new AVD rates do have some concessions for transactions involving permanent residents of Hong Kong. Once you have decided to take the plunge and buy our first property in Hong Kong, you need to arm yourself with the services of a good realtor. Sure you have myriad resources available on the Internet today, and real estate agents are easily available on any street corner of Hong Kong. However, the choice of a good real estate agent is vital to the acquisition of your dream home. Your real estate agent should be attuned to your needs and wishes and should not try and impose his/her perspective on you. He/she should be licensed to practice in Hong Kong and also be well informed to provide you with accurate information on price trends and features of the properties under consideration. So if you are looking for a Hong Kong property for sale in order to be a part of one of the most exciting and dynamic cities in the world, consider reaching out to us here at Engel & Völkers Hong Kong to help you search residential properties. With us, you gain access to the most experienced residential real estate agents in Hong Kong not to mention a wide-selection of Hong Kong luxury homes for sale exclusively sold by us.
The Right Real Estate Agent
As in every profession, real estate has its good and bad agents, and there have in fact been cases where unscrupulous agents have exerted pressure on buyers to agree to a buy transaction without even inspecting a property.
You can be rest assured that the qualified and professional at Engel and Volkers Hong Kong do not indulge in such practices. So if you are in the market for your first Hong Kong home, do not hesitate to contact us at the soonest.
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